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Robert Reich reiterated what he wrote at his blog today to Ed Schultz--The President's Job's Initiative Doesn't Measure Up:

No president in modern times walks a tightrope as exquisitely as this one. His balance is a thing of beauty. But when it comes to this economy right now -- an economy fundamentally out of balance -- we need a federal government that moves boldly and swiftly to counter-balance the huge recessionary forces still at large.

States and cities, for example, are estimated to be $350 billion hole this year and next. They can't run deficits so they're wildly cutting spending, cutting jobs, cutting contracts, and raising taxes and fees. That's a huge anti-stimulus package roughly as big as the remaining direct spending in the old federal stimulus package. Which means, Obama's "new" stimulus, announced today, is about all we have, and it's not nearly enough.

[...]

There is no reason to tolerate this degree of misery. We know exactly what to do. The government has the fiscal tools to do it. Start by bailing out state and local governments (if Congress would prefer to call it a loan and require payback over the next five years, fine). Renew unemployment and COBRA benefits. Increase federal spending on infrastructure. If we have to, hire people directly. The package should be $400 billion over two years.

When Ed Schultz noted that the credit markets need to be loosened up for small businesses and that he thought the TARP money should be used for that and not only for government jobs, Reich responded:

Ed it is the right thing to do. I wish though when we bailed out the big banks, one of the reasons we bailed out the big banks was so they would turn around and provide credit for small businesses. Actually nothing like that happened. We bailed out the big banks and now we're bailing out small businesses.

Just one more of the many strings that should have been attached to that money. Of course the Republicans won't want to go along with any of it and scream more about the need for deficit reductions. Unless of course that interferes with tax cuts for the rich or military spending. Then the sky's the limit and deficits don't matter.

Former Labor Secretary Robert Reich tries to inject a little sanity into the discussion of the public option, courtesy of Brave New Films.

Get more information at Sick For Profit, including sharing your own health insurance horror stories.

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Phil Gingrey (R-Healthcare Industry) doesn't think we need any stinking regulation of the insurance industries. Just trust them if they say they're going to make changes. Why do we need any silly laws to make sure they behave? We've got their word they won't keep shafting us. Isn't that good enough?

Of course when pinned down on those statements and asked directly if we can trust the insurance industry to keep their word without any laws in place to make sure they won't keep sticking it to their customers, Gingrey retreats to attacking a "government takeover" of health care rather than answer the question.

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(h/t Heather.)

Robert Reich wonders why Baucus, Grassley et all are getting to decide for the nation on health care reform. We'll all pay for Obama's little experiment:

Aug. 23, 2009 | On Thursday, the so-called Gang of Six – three Republicans and three Democrats on the Senate Finance Committee – met by conference call and, according to Max Baucus, D-Mont., the committee's chair, reaffirmed their commitment "toward a bipartisan healthcare reform bill" (read: less coverage and no public insurance option). The Washington Post reports that the senators shared tales from their home states, where some have been besieged by protesters angry about a potential government takeover of the nation's healthcare system.

It's come down to these six senators. The House has reported a bill, as has another Senate committee, but all eyes are fixed on Senate Finance – and on these three Dems and three Republicans, in particular. But who, exactly, anointed these six to decide the fate of the nation's healthcare?

I don't get it. Of the three Republicans in the gang, the senior senator is Charles Grassley, R-Iowa. In recent weeks Grassley has refused to debunk the rumor that the House's healthcare bill will spawn "death panels," empowered to decide whether the sick and old get to live or die. At an Iowa town meeting last Tuesday Grassley called the president and Speaker Nancy Pelosi "intellectually dishonest" for claiming the opposite. On Thursday Grassley told the Washington Post that Congress should scale back its efforts to overhaul healthcare in the wake of intense anger at town hall meetings. But – wait – the anger is largely about distortions such as the "death panels" that Grassley refuses to debunk.

This week on Fox News, Grassley termed the House bill "the Pelosi bill," and called it "a government takeover of healthcare, exploding the deficit because it's not paid for and it's got high taxes in it."

No, it will explode the deficit because the Blue Dogs fought the Medicare reimbursement rate successfully and as a result, the so-called public option will now cost as much as regular insurance. And because WalMart successfully fought for a grandfather clause that will enable them to provide the crappy, bare-bones insurance they always did, but competitors will have to pay for the real insurance. (Oh, and those workers will now be kicked on Medicaid and forced to take WalMart's crappy plan. Good times!)

But I digress.

Reich continues:

I really don't get it. We have a Democratic president in the White House. Democrats control 60 votes in the Senate, enough to overcome a filibuster. It is possible to pass healthcare legislation through the Senate with 51 votes (that's what George W. Bush did with his tax-cut plan). Democrats control the House. The Speaker of the House, Nancy Pelosi, is a tough lady. She has said there will be no healthcare reform bill without a public option.

So why does the fate of healthcare rest in Grassley's hands?

It's not even as if the gang represents America. The three Dems in the gang are from Montana, New Mexico and North Dakota – states that together account for just over 1 percent of Americans. The three Republicans are from Maine, Wyoming and Iowa, which together account for 1.6 percent of the American population.

So, I repeat: Why has it come down to these six? Who anointed them? Apparently, the White House. At least that's what I'm repeatedly being told by sources both on the Hill and in the administration. "The Finance Committee is where the action is. They'll tee up the final bill," says someone who should know.

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Paul Krugman and Robert Reich both made some really great points during the panel discussion on This Week on the reasons for some real reform of the insurance industry, the mistakes made by the President in negotiating with the Senate, and the notion that there is a need for bipartisanship when the Republican party has moved so far out of the mainstream. And this statement by Krugman bears noting:

Krugman: Well, the public option again, this is something, that, there’s a question whether they're for it, or whether, are they willing to actually vote against cloture to stop this really quite modest but helpful piece of the reform being in there? (crosstalk) They have no intellectual basis to stand on, right? The argument against the public option is sheer nonsense. We know that. It's nothing except the insurance lobby.

Exactly. If these conserva-Dems want to block health care reform and getting the insurance industries in check, make them actually have to stand up and filibuster it along with the Republicans and show their true colors.

Transcript below the fold.

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Paul Krugman calls out John McCain for his double talk on controlling Medicare costs during this panel discussion with George Stephanopoulos on This Week. As Krugman notes, the Republicans and John McCain are trying to have it both ways and one one hand saying Medicare's costs need to be kept in check, and on the other hand scaring seniors into thinking that the President wants to cut their Medicare benefits, and refusing to have a rational debate on how those costs end up being controlled.

David Frum tries to defend the Medicare Advantage program which is one of the things the Obama administration wants to go after to control costs, and Krugman shoots a hole straight through his arguments and reminds him that wasteful spending is what Republicans are supposed to be against. George Will wraps things up with showing his love for the pharmaceutical industry and their profits.

WILL: We’ve been talking about this for about five minutes and the subject of cost, which is tiresome and depressing, has not come up.

REICH: I just mentioned it.

WILL: When we began this debate a few months ago, the costs were going to be paid primarily by two things. One, the proceeds from selling under cap and trade, the permits to emit carbon. And “B,” Medicare cuts. “B” is never going to happen. And we’ve given away what should have been sold, or so we say, the rights to emit carbon. Where are we going to pay for this?

KRUGMAN: Medicare stuff, I think, will, in fact, happen if anything passes. If you want to think about the utter, utter hypocrisy of the Republicans on this. We just heard John McCain . And early on in your conversation, he said basically Sarah Palin was right in saying death panels because the Democrats want Medicare to take into account the actual medical effectiveness --

STEPHANOPOULOS: They weren’t in support of the policy.

KRUGMAN: Right. And then later in the same conversation, he said, we have a terrible problem with entitlements with Medicare. We really need to do something to cut Medicare spending. And what possible way -- we should cut Medicare spending without any regard for the medical effectiveness of what it’s paying for? So, this is, you know, we have the Republicans actually standing fully against any sort of rational control of costs.

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Robert Reich was out beating the drum yesterday, speaking on "This Week" and posting this piece in Salon:

If you want to save universal healthcare, you must do several things, and soon:

1. Go to the nation. You're not only a powerful orator; you're also capable of motivating, energizing, and mobilizing the American public. You must go on the road -- building public support by forcefully making the case for universal health care everywhere around the country. The latest Wall Street Journal poll shows that three out of four Americans want universal healthcare. But the vast majority don't know what's happening on the Hill, don't know how much money the medical-industrial lobbies are spending to defeat it, and have no idea how much demagoguery they're about to be exposed to. You must tell them. And don't be reluctant to take on those vested interests directly. Name names. They've decided to fight you. You must fight them.

This is the president's biggest weakness. Please, more drama, Obama!

2. Be LBJ. So far, Lyndon Johnson has been the only president to defeat the American Medical Association and the rest of the medical-industrial complex. He got Medicare and Medicaid despite their cries of "socialized medicine" because he knocked heads on the Hill. He told Congress exactly what he wanted, cajoled and threatened those who resisted, and counted noses every hour until he had the votes he needed. When you're not on the road, you have to be twisting congressional arms and drawing a line in the sand. Be tough.

3. Forget the Republicans. Forget bipartisanship. Universal healthcare can pass with 51 votes. You can get 51 votes if you give up on trying to persuade a handful of Republicans to cross over. Eight years ago George W. Bush passed his huge tax cut, mostly for the wealthy, by wrapping it in an all-or-nothing reconciliation measure and daring Democrats to vote against it. You should do the same with healthcare.

4. Insist on a real public option. It's the linchpin of universal healthcare. It's one thing to give up on single payer, and say that a public option is the best feasible alternative. But further compromise would essentially gut any healthcare plan. Don't accept Kent Conrad's ersatz public option masquerading as a "healthcare cooperative." Cooperatives won't have the authority, scale, or leverage to negotiate low prices and keep private insurers honest.

5. Demand that taxes be raised on the wealthy to ensure that all Americans get affordable healthcare. Not even a real public option will hold down costs enough to make healthcare affordable to most American families in years to come. So you'll need to tax the wealthy. Don't back down on your original proposal to limit their deductions. And support a cap on how much employee-provided healthcare can be provided tax free. Yes, you opposed this during your campaign. But you have no choice but to reverse yourself on this. These are the only two big pots of money.

6. Put everything else on hold. As important as they are, your other agenda items -- financial reform, home mortgage mitigation, cap-and-trade legislation -- pale in significance relative to universal healthcare. By pushing everything at once, you take the public's mind off the biggest goal, diffuses your energies, blur your public message, and fuel the demagogues who say you're trying to take over the private sector. You have to win this.

Newshoggers: Obama's insistence on sheltering the toxic fallout survivors of Bush's criminal policies has already poisoned his presidency for me

TAPPED: WTF? In the wake of George Tiller's assassination, Obama has appointed Alexia Kelley, executive director of Catholics in Alliance for the Common Good (CACG), to head the Center for Faith-Based and Neighborhood Partnerships at the Department of Health and Human Services. Kelley has made it clear that she seeks to reduce access to abortion. 

Corrente: Robert Reich on how Olympia Snowe's "trigger" will kill the public option

Emptywheel: All the News the NYT does not see fit to print

Mugsy’s Rap Sheet: We don't always agree with the president, but we haven't accused him of treason. Sign the petition to censure Senator Inhofe for his dishonest and destructive attacks on Obama

WEB TV News: Tired of the same old TV propaganda? You can get some of the rest of the world's here (hat tip CW)

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I don't think Tim Geithner is the right person to fix the mess we're in since he's too close to those on Wall Street that caused the problem to begin with, but how ridiculous is George Will in this clip? Even after the giant mess that the "markets" have created with no regulation, Will is still doing his best job of channeling Ronald Reagan's mantra of let the markets take care of themselves and government can't solve our problems because it is the problem. Whether Geithner can fix the mess or not we sure need regulations put back in place and quickly IMO which will be up to the Congress to get passed. Will does his best to conflate Geithner's troubles with government regulation being bad.

Will: This is a complicated society with trillions of decisions made every day driving this. That's why you have markets rather than bureaucrats to allocate wealth and opportunity.

Reich: The markets failed George. Let's be clear about that. The markets failed.

Will: Just you wait till the government gets at it. If you think that this is a failure, just you wait.

Reich: Well it's already failing. Look at, we have the worst economic conditions we have had. We had a market fundamentalist as President. We had market fundamentalism as the guiding economic philosophy and what happened? We got in this mess George.

Will: Sixty two days ago Mr. Geithner was the indispensable man and never mind his little tax problems, he was indispensable. As de Gaulle said---graveyards are full of indispensable men.

Is Will an indispensable man too? Raise your hands. Geithner... bad. Therefore regulation... bad. Free market... good. Bad man trying to mess up free market...very bad.

To listen to Will is like listening to a man who has been living in a cave and totally cut off from society and all forms of communication these last eight years. The financial sector has already melted down and we're hanging on by a thread, but not in Will's alternate reality. Does he really want to live in a society where the free markets rule everything and the government takes care of nothing? Apparently so. I'd like to see him try to live in a place that actually espouses the virtues he holds so dear.

Need a cop to come to your house??..you're on your own and buy more guns. Want some traffic lights working in your neighborhood??...just call in Blackwater. Want to drive on any of the roads in this country??...pay a toll and hope they don't jack up the prices too high. Want your phone to work??...well the phone company decided that your area isn't profitable enough to keep service there so too bad. Want your lights turned on?...well the electric company decided that a big industry was more profitable than you were to provide service to.

Don't you dare let the government interfere in any of those free markets....right George Will? Heaven forbid who knows what might happen if they did.

(John Amato helped with the post)

Robert Reich:

Presidential budgets are aspirations. They're not real, in the sense that no one really has to adhere to them. Obama's budget now goes to Congress, where budget committees will draw up their own versions. Even these congressional budgets are mere guidelines for appropriations and tax-writing committees. Lobbyists will be swarming. So don't expect the final sausage to look exactly like the meat the President is putting into the grinder. On the other hand, the sausage is likely to bear more than a passing resemblance. Remember: This president's approval ratings are well over 60 percent -- substantially higher than Congress's overall approval rating, and far far higher than Republicans in Congress -- and the nation is still looking to Obama to lead the way out of our troubled times. And it's a Democratic congress, with a Democratic Senate that could be (if Franken is seated) one vote short of being able to cut off a filibuster.

It's about time a presidential budget uneqivocally redistributed income from the very rich to the middle class and poor. The incomes of the top 1 percent have soared for thirty years while median wages have slowed or declined in real terms. As economists Thomas Piketty and Emanuel Saez have shown, in the 1970s the top-earning 1 percent of Americans took home 8 percent of total income; as recently as 1980 they took home 9 percent. After that, total income became more and more concentrated at the top. By 2007, the top 1 percent took home over 22 percent. Meanwhile, even as their incomes dramatically increased, the total federal tax rates paid by the top 1 percent dropped. According to the Congressional Budget Office, the top 1 percent paid a total federal tax rate of 37 percent three decades ago; now it's paying 31 percent.

Fairness is at stake but so is the economy as a whole. This Mini Depression is partly the result of a widening gap between what Americans can afford to buy and what Americans when fully employed can produce. And that gap is in no small measure due to the widening gap in incomes, since the rich don't devote nearly as large a portion of their incomes to buying things than middle and lower-income people. The rich, after all, already have most of what they want.